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Crypto Prices Quickly Slide After Troubling U.S. PPI Report
Inflation at wholesale level in the U.S. in July sped up far beyond economist forecasts, calling into question expectations for lower interest rates.
Aug 14, 2025, 12:59 p.m.
What to know:
- July PPI surged 0.9% month-over-month and 3.3% year-over-year, both well above forecasts, reducing expectations for near-term Fed rate cuts.
- Bitcoin and ether quickly tumbled, leading crypto markets sharply lower in wake of the data.
Inflation concerns were re-ignited during U.S. morning hours Thursday, sending risk assets — crypto among them — sharply lower.
The July Producer Price Index (PPI) rose 0.9%, blowing past estimates for 0.2% and 0.0% in June. On a year-over-year basis, PPI was higher by 3.3% versus forecasts for 2.5% and June's 2.4%.
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Core PPI, which excludes food and energy, also surged 0.9% in July, far exceeding the 0.2% expected and 0.0% in June. Core CPI year-over-year rose 3.7% against 2.9% expected and 2.6% in June.
Already well off a record high hit overnight above $124,000, bitcoin tumbled below $119,000 on the news. Ether plunged nearly 4% to $4,550. Other recently red-hot altcoins like solana and were similarly struck.
Fresh labor market data provided no relief, with initial jobless claims for the week ending August 9 at 224,000, slightly below the 228,000 expected, and continuing claims holding at 1.95 million. The still-tight labor market, combined with the strong PPI readings, reinforced the view that the Fed may keep interest rates elevated for longer to tame inflation.
According to CME FedWatch, the previous 100% chance for a September rate cut slipped to 96% in wake of the fresh data.
In traditional markets, U.S. stock index futures have slipped 0.5%, the dollar is gaining ground and the 10-year U.S. Treasury yield moved higher by five basis points to 4.25%.
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Bitcoin’s Deep Correction Sets Stage for December Rebound, Says K33 Research
K33 Research says market fear is outweighing fundamentals as bitcoin nears key levels. December could offer an entry point for bold investors.
What to know:
- K33 Research says bitcoin’s steep correction shows signs of bottoming, with December potentially marking a turning point.
- The firm has argued that the market is overreacting to long-term risks while ignoring near-term signals of strength, like low leverage and solid support levels.
- With likely policy shifts ahead and cautious positioning in futures, K33 sees more upside potential than risk of another major collapse.
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